Following Essilor's and Hoya's US expansion policy and its own track record in Europe, Sola International has acquired two more prescription labs in the USA with annual revenues of $13.5 million. They are B&W Optical Co. in Baltimore and Southeastern Optical in Roanoke, Virginia.
The management stresses once again that these investments are not meant to bypass other independent labs that Sola works with, but rather to speed up the introduction of value-added products like its new Teflon EasyCare coatings. Successfully launched in Italy in July, these coatings are now being marketed in the UK. They are being launched in France, Portugal and Australia, and test-marketed in the USA.
Sola reports 1st quarter results in line with expectations. The group had a net loss of $5,352,000 in the period ended June 30, as compared to net income of $6,678,000 a year ago, largely because of negative currency exchange effects of $10.7 million after tax. Excluding the final currency impact, the full fiscal year is still expected to show a profit of $26-28.5 million.
Contrary to previous performance, European sales declined by 0.2 percent in the quarter on a constant currency basis. The company blames short-term supply problems and reduced deliveries of recently launched photochromic lenses, adding that they problems have now been dealt with.
North America and the rest of the world were down 3.9 and 0.3 percent, respectively, but North American sales began to rise again in July. Total consolidated sales dropped by 0.6 percent to $135.2 million. However, sales through Sola's own prescription labs grew by 18 percent, and sales of polycarbonate lenses rose by 24.4 percent in volume and by 29 percent in value. Polycarbonate capacity is being expanded further in the USA.